In this week’s “Latest News” there are announcements of interest to:
– owners of condos and PUDs, and
– real estate agents.
Contractors are advised to look closely at this week’s Latest News, as they will need to understand the modifications to the CFSIC program that have been made.
CFSIC-Sponsored Re-examination Program
In order to assist condos and PUDs, the Superintendent has authorized the existing CFSIC-sponsored severity class code re-examination program to be extended from its current sunset date of April 30, 2019 to July 31, 2019.
Condos and PUDs
CFSIC’s board, at its recent board meeting, agreed that CFSIC’s current cap of $175,000 for eligible concrete work under CFSIC’s guidelines will apply to condominiums and PUDs as well, subject to what follows.
Speaking first of condominiums, what this means is that the cap of $175,000 for eligible concrete work per foundation platform will remain what it is as part of CFSIC’s existing Underwriting and Claims Management Guidelines, which also includes four condo units or fewer sitting on the same foundation.
Under the enabling legislation, CFSIC cannot entertain an application for a condominium foundation platform containing greater than four condo units. We expect the enabling legislation to change, perhaps in June, in order to fix this wording issue. We’re counting on this being fixed.
Once the legislation changes, CFSIC will consider each additional condo unit above the first four sited on a single platform to be capped at a 25% pro rata of the $175,000 cap.
Using an example of six condo units on one platform, this would result in a total cap applying of $175,000 (for the first four units) plus $87,500 (or an allocation each of $43,750 for the remaining two), for a total of $262,500. In other words, each unit above the first four is capped at 25% of the total cap of $175,000 applying to the first four.
As of March 11, nothing prevents a condominium association from applying for either a Type 1 (replacement) or a Type 2 (reimbursement) claim, provided that any foundation platforms applied for, for either type of claim, don’t contain more than four living units.
For example, if a condo association has sixty units, of which one platform contains three units and another contains four, and both platforms are affected, the association can, as of March 11, apply with respect to either a Type 1 or Type 2 claim for both these affected platforms, on one application, provided that the association observes the following guidelines:
1) One application is filed for all the eligible platforms/units in question at the same time.
2) The application is sent to ESIS and uploaded electronically, with all applicable points of evidence…for the units in question.
3) Then, under separate cover, the president of the association sends ESIS an email using the condo email template (see template here). This happens after the application is submitted. The template describes in more detail what can’t be described in the current applicant, and is therefore considered a supplement to that application.
4) The association understands and agrees that, once the enabling legislation changes, the association may apply one more time under a completely separate application for all remaining affected units that it did not apply for under the first application (the association would only be able to apply one more time for all remaining affected units).
5) The application would have to include all applicable Type 1 and Type 2 points of evidence…including a severity coding for the platform or platforms in question (Type 1 app only)…and the subsequent application for the remaining platforms would have to include all the points of evidence all over again.
All other terms and conditions of the CFSIC program would apply.
With regard to PUDs, as of March 11, nothing prevents the owner of a PUD, who also owns the foundation, from applying, if the unit affected is a single unit existing on a single foundation (in other words, a single-family dwelling).
The only way that PUDs can apply if more than one unit sits on a single foundation is for the PUD’s association to apply, just as would be the case with a condo association. The same rules apply: a PUD association applies on behalf of some of the platforms (remembering the rule of four-units-and-under per platform), and applies later, using a second application for the remainder, once the legislation changes.
All other terms and conditions of the CFSIC program would apply.
CFSIC cannot be involved in disputes among multiple PUD owners sited on one foundation platform. The PUD association will have to represent to CFSIC that it can sign CFSIC’s Participation Agreement on behalf of all affected PUD owners applying sited on the same platform, subject at all times to the current rule that no more than four units can exist on one foundation platform. What this means is that, unlike with a condominium configuration, if a PUD platform has three living units, and two of the owners agree to raise the foundation and a third does not…CFSIC will not pay that claim unless the association works this out in advance and represents that by submitting a completed application and providing ESIS with the appropriate PUD templated email.
The Participation Agreements found on this website have also been changed as of March 11 to reflect that an association, if applicable, either with respect to a condo or a PUD, must represent that it has the authority to enter into the Participation Agreement with CFSIC, on behalf of all affected units, regardless of whether those units are condos or PUDs.
Within the “For Homeowners” section of this site, we’ve constructed a special section (section #15) in order to assist homeowners and their associations to understand this application process. To learn more about Condo and PUD Application Assistance, click here.
Real Estate Agents’ Advisory
We’ve created a special section for real estate agents as a response to the many questions we’ve received about the operations and guidelines of the CFSIC program. This is located within the “For Homeowners” section (section #14). To view the Real Estate Agent Assistance section, click here.
If you have any questions about the operation of the program, ESIS is your best source of information on your claim, and their phone number and email are shown below.
As you work through the information and application process, here’s how you can get help:
– Call ESIS (the claim adjuster) at: 844-763-1207
– Email ESIS at: firstname.lastname@example.org
– Email CFSIC at: email@example.com
Michael Maglaras, Principal
Michael Maglaras & Company